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Published:October 28th, 2010 10:53 EST
Breaking News:  11 U.S. States Facing Bankruptcy

Breaking News: 11 U.S. States Facing Bankruptcy

By SOP newswire2

Estimate: $3 trillion in unfunded public obligations nationwide

Business Insider ran an article last week listing the 11 most immediate state government pension crises. The shocker was that the worst off states were not New York or California, but in Middle America.

Nationwide, a new estimate reveals unfunded liabilities in state and local government public employee retirement funds may amount to $3 trillion, not the $2 trillion previously estimated.

Here is the list of 11 states most likely to run out of pension fund money, together with a description of the state government pension problem the state faces:
1) Illinois

Year pension fund runs out: 2018

Bill in the following year: $13.6 billion

Share of state revenue: 32 percent
2) Connecticut

Year pension fund runs out: 2019

Bill in the following year: $4.9 billion

Share of state revenue: 27 percent
3) Indiana

Year pension fund runs out: 2019

Bill in the following year: $3.6 billion
Share of state revenue: 17 percent
4) New Jersey

Year pension fund runs out: 2019

Bill in the following year: $14.4 billion
Share of state revenue: 34 percent
5) Hawaii

Year pension fund runs out: 2020

Bill in the following year: $1.7 billion
Share of state revenue: 24 percent
6) Louisiana

Year pension fund runs out: 2020

Bill in the following year: $4.3 billion
Share of state revenue: 27 percent
7) Oklahoma

Year pension fund runs out: 2020

Bill in the following year: $3.7 billion
Share of state revenue: 30 percent
8) Colorado

Year pension fund runs out: 2022

Bill in the following year: $7.8 billion
Share of state revenue: 54 percent
9) Kansas

Year pension fund runs out: 2022

Bill in the following year: $2.5 billion
Share of state revenue: 23 percent
10) Kentucky

Year pension fund runs out: 2022

Bill in the following year: $5.3 billion
Share of state revenue: 35 percent
11) New Hampshire

Year pension fund runs out: 2022

Bill in the following year: $1 billion
Share of state revenue: 30 percent

Unfunded state pension unfunded liabilities now estimated at $3 trillion

A study released by the National Center for Policy Analysis reveals that the crisis in unfunded liabilities in state and local government public employee retirement funds may amount to $3 trillion, not the $2 trillion previously estimated.

The National Center for Policy Analysis examined discount rates used in calculating how state and local government pension plans are calculated, concluding that liabilities may be 75 - 86 percent higher than reported.

The significance of that finding: "As a result, taxpayers` role as insurer may be much greater than anticipated."

The group analyzed 153 state and local pension plans, representing more than 85 percent of liabilities for state and local government pensions and other benefits, recalculating their liabilities using a lower discount rate.

The conclusions:

   * Unfunded pension liabilities are approximately $3.5 trillion, compared to the reported amount of $493 billion.

   * Unfunded liabilities for health and other benefits are $558 billion, compared to the reported $537 billion.

   * Thus, total unfunded liabilities for all benefit plans are estimated at $3.1 trillion - nearly three times higher than the plans reported.

To put these liabilities in context, the National Center for Policy Analysis pointed out that unfunded obligations under pension and other plans amounted to 7.1 percent of gross domestic product, or GDP, in 2008.

When adjusted using a "more appropriate" discount rate, the states` unfunded obligations were 22 percent of U.S. GDP.

Further, all but 10 states and the District of Columbia have total adjusted unfunded liabilities above 15 percent of their state GDP, while four states - Alaska, Hawaii, New Jersey and Ohio - have adjusted unfunded liabilities above 35 percent of their state GDP.


ABOUT THE AUTHOR: Jerome R. Corsi received a Ph.D. from Harvard University in political science in 1972. He is the author of the #1 New York Times bestselling books THE OBAMA NATION: LEFTIST POLITICS AND THE CULT OF PERSONALITY and the co-author of UNFIT FOR COMMAND: SWIFT BOAT VETERANS SPEAK OUT AGAINST JOHN KERRY. He is also the author of AMERICA FOR SALE, THE LATE GREAT U.S.A., and WHY ISRAEL CAN`T WAIT. Currently, Dr. Corsi is a Senior Managing Director in the Financial Services Group at Gilford Securities as well as a senior staff writer for WorldNetDaily.com.


ABOUT GILFORD SECURITIES: Gilford Securities, founded in 1979, is a full-service boutique investment firm headquartered in New York City providing an array of financial services to institutional and retail clients. From investment banking and equity research to retirement planning and wealth management services, our financial experts are prepared to accommodate the needs of investors. For more information about Gilford Securities please visit, Click Here: http://www.gilfordsecurities.com/financial-services-group.php

The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect Gilford Securities Incorporated`s views, opinions, positions or strategies. Gilford Securities Incorporated makes no representations as to accuracy, completeness, currentness, suitability, or validity of any information expressed herein  and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use.


ABOUT RED ALERT: Jerome Corsi`s RED ALERT is your weekly, global financial strategies newsletter. Designed to be your guide to economic trends in the best of times and the worst of times, it is edited by New York Times best-selling author Jerome Corsi, Senior Managing Director of the Financial Services Group at Gilford Securities as well as a WND senior staff writer and columnist. For 25 years, Corsi worked with banks throughout the U.S. and the world developing financial services marketing companies to assist banks in establishing broker/dealers and insurance subsidiaries to provide financial planning products and services to their retail customers. Corsi developed three third-party financial services marketing firms that reached annual gross sales levels of $1 billion in annuities and equal volume in mutual funds. Corsi received his Ph.D. in political science from Harvard University in 1972.

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JEROME CORSI`S RED ALERT
By Dr. Jerome Corsi
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